Vyrl is not responsible for use of this information to construct an FTC-compliant disclosure. Influencers and brands should reference FTC influencer guidelines directly at FTC.gov for more information and can contact email@example.com to ask any questions about FTC disclosures.
Update: The FTC updated their FTC influencer guidelines about disclosures in November 2019.
Over 90% of brand-sponsored content on Instagram does not follow FTC Guidelines (Credit: Mediakix). These posts could have legal repercussions for the influencer and the brand. Influencers and brands could be on the hook for massive penalties from the FTC in the future for these types of violations.
The FTC, or Federal Trade Commission, is the government agency that protects consumers against unfair or deceptive business practices. It is also the government agency that regulates influencer marketing and provides guidelines for how brands and influencers can work together.
The information provided in this article should help get you started with FTC compliance, but it is up to the influencer and brand to be FTC compliant. You can confirm your disclosure approach direct with the FTC. Here are a few helpful links:
Primarily, the FTC is concerned about disclosures for brand and influencer partnerships….
A Disclosure is basically a statement that lets consumers and audience members know the true relationship between the brand and the influencer.
“The FTC’s Endorsement Guides provide that if there is a “material connection” between an endorser and an advertiser – in other words, a connection that might affect the weight or credibility that consumers give the endorsement – that connection should be clearly and conspicuously disclosed, unless it is already clear from the context of the communication. A material connection could be a business or family relationship, monetary payment, or the gift of a free product. Importantly, the Endorsement Guides apply to both marketers and endorsers.”From Federal Trade Commission
In each disclosure, brand requirements and influencer responsibilities should be clear. Did the brand pay the influencer to post? Were the products free? Does the influencer have to say certain phrases? All of this should be clear in a disclosure.
How much to disclose:
Many influencers and bloggers worry that disclosures will hurt their future business by exposing the “behind the scenes” of influencer marketing. This does not have to be the case. In disclosures, it is important to determine the level of information you need to disclose.
The FTC recommends letting consumers know whatever information would have an effect on the weight readers would give your review. However, you are not required to release information beyond that. The amount you were paid does not have to be disclosed.
Brands often send free products as incentives to influencers. Free products can be the start of a relationship between that brand and the influencer. Better to start off on the right foot.
Disclosures are required any time a company has made a “material connection” in exchange for social media exposure. A “material connection” is anytime a brand pays, trades, or gives a gift to the influencer to start a relationship. Products given to the influencer definitely count as gifts and hold the expectation of social media exposure or reviews.
Adding #Ad is an acceptable disclosure for sponsored content on Instagram. #Ad should be placed at the beginning of the post, not below the “See More” tag, per FTC guidelines. In addition to the hashtag, it should also be clear what the relationship is between the brand and the influencer. The consumer should understand the relationship when the influencer mentions that it is a paid post.
More commonly than any of us would care to admit, we wonder what the consequences are if we simply didn’t follow all the FTC influencer guidelines or if we “fudged” the disclosures a bit. To answer this, the FTC has made several large actions against brands and influencers alike.
In the past, the FTC has sent letters to influencers and marketers citing their past campaigns and reminding them of the disclosure requirements. In April 2017, the FTC sent 90+ warning letters to influencers that weren’t following the rules for endorsements and advertising products. Since then, the volume of warnings issued by the FTC has only increased.
The FTC has also recently escalated their efforts to crack down on influencers and marketers by bringing lawsuits against larger violators.
The FTC also has the ability to fine the offenders. At the end of the day, it’s just too big a risk to skip disclosures with the FTC ready to pounce on future offenders.
According to FTC influencer guidelines: